As independents buy and sell in 2014, the forces driving acquisition and divestiture (A&D) activity seem to be different, said Evan Calio, an analyst with Morgan Stanley (NYSE: MS), in a recent report.
Years of inventory are surpassing reserves and production as the bellwether for reinvestment risk and stock value, he said.
“Unprecedented inventory visibility in unconventional has driven wider valuation variance among E&Ps [exploration and production companies],” Calio said.
Calio said May’s buyers looked for inventory longevity.
Sanchez Energy Corp. (NYSE: SN) paid $639 million for Royal Dutch Shell ...